Nifty surges above 2300 helped by stable interest rates

After two days of strong gains in which the indices gained well over 2 per cent each, the markets opened the day with a high degree of volatility. The indices dipped immediately after opening, bounced back and declined again as traders remained unsure of the market direction ahead of the derivatives settlement on Thursday.

The markets stabilised within an hour and started a steady up trend on short covering. The indices got a boost as RBI left the short term interest rates unchanged and bank stocks surged.

Late afternoon saw a sharp dip in the indices as some profit booking emerged. The markets took no time in recovering lost ground and surged ahead to close at the day's highs.

Sensex closed at 7553, a gain of 47 points and the Nifty at 2303, a gain of 11 points. Nifty July futures closed the day at a premium of 1 point to the spot index.

SAIL, Dr.Reddy's and ICICI Bank were among the major gainers among Nifty stocks while Sun Pharma, ACC and Gail were the major losers.

After a volatile session, the US markets closed the day yesterday with losses. Rising crude prices and nervousness among traders ahead of major corporate results led to the weakness. The Dow and S&P 500 lost close to half-a-per cent each while NASDAQ closed lower by over half-a-per cent.